Posts Tagged ‘Franklin Raines’

We’re constantly being told that Obama has done a great deal to make our economy stronger. Because who wouldn’t rather have 9.1% unemployment than that 7.6% that Obama started out with.

The thing that most killed the US economy in 2008 was the sheer weight of godawful subprime mortgages that Democrats imposed on Fannie Mae, Freddie Mac and all the other mortgage lenders in order to create more “fairness” and allow everyone (especially racial minorities) to have “the right” to own a home whether they could actually afford to do so or not. Fannie Mae and Freddie Mac were “Government Sponsored Enterprises,” all the investors knew. So even as Fannie and Freddie began bundling together thousands of riskier and ever riskier mortgages into giant mortgage backed securities to advance Democrat-enacted policies, large investment houses continued to gobble them up. After all, this was an arm of the United States Government – and the United States Government ALWAYS pays its debts.

Like all scams, it worked for a while. But as soon as there was a correction in the dramatically overvalued housing market, the whole boondoggle began to implode. And since Fannie and Freddie had bundled all kinds of bad mortgages in with the good ones, there was absolutely no way for anyone to know how much risk was contained in any of these giant investment vehicles all these giant private banking houses found themselves holding.

And suddenly the perception that Government Sponsored Enterprises Fannie Mae and Freddie Mac were “safe investments” turned into a “misperception.” And the fecal matter began to hit the rotary oscillator bigtime.

Fannie and Freddie were the first to collapse. The big private players who had played ball with them shortly followed.

WASHINGTON, Sept. 10— The Bush administration today recommended the most significant regulatory overhaul in the housing finance industry since the savings and loan crisis a decade ago.

Under the plan, disclosed at a Congressional hearing today, a new agency would be created within the Treasury Department to assume supervision of Fannie Mae and Freddie Mac, the government-sponsored companies that are the two largest players in the mortgage lending industry.

The new agency would have the authority, which now rests with Congress, to set one of the two capital-reserve requirements for the companies. It would exercise authority over any new lines of business. And it would determine whether the two are adequately managing the risks of their ballooning portfolios.

Republicans were demonized for “deregulation” by the dishonest Democrat Party machine. But they TRIED to regulate what needed to be regulated. Democrats stopped them.

In moving, even tentatively, into this new area of lending, Fannie Mae is taking on significantly more risk, which may not pose any difficulties during flush economic times. But the government-subsidized corporation may run into trouble in an economic downturn, prompting a government rescue similar to that of the savings and loan industry in the 1980′s.

”From the perspective of many people, including me, this is another thrift industry growing up around us,” said Peter Wallison a resident fellow at the American Enterprise Institute. ”If they fail, the government will have to step up and bail them out the way it stepped up and bailed out the thrift industry.”

Fannie Mae and Freddie Mac are so big — they own or guarantee roughly half of the nation’s $12 trillion mortgage market — that the thought that they might falter once seemed unimaginable. But now a trickle of worries about the companies, which has been slowly building for years, has suddenly become a torrent.

And it was FANNIE and FREDDIE that collapsed FIRST before ANY of the private investment banks, which collapsed as a result of having purchased the very mortgaged backed securities that the Government Sponsored Enterprises SOLD THEM. It wasn’t until Fannie and Freddie collapsed that investors began to look with horror at all the junk that these GSE boondoggles had been pimping.

The man who predicted the collapse in 1999 wrote a follow-up article titled, “Blame Fannie Mae and Congress For the Credit Mess.” It really should have read, “Blame DEMOCRATS.” Because they were crawling all over these GSEs that they had themselves created like the cockroaches they are. But Wallison is nonpartisan.

”These two entities — Fannie Mae and Freddie Mac — are not facing any kind of financial crisis,” said Representative Barney Frank of Massachusetts, the ranking Democrat on the Financial Services Committee. ”The more people exaggerate these problems, the more pressure there is on these companies, the less we will see in terms of affordable housing.”

Representative Melvin L. Watt, Democrat of North Carolina, agreed.

”I don’t see much other than a shell game going on here, moving something from one agency to another and in the process weakening the bargaining power of poorer families and their ability to get affordable housing,” Mr. Watt said.

Why was Barney Frank deceitfully claiming that Fannie and Freddie weren’t facing “any kind of financial crisis”? BECAUSE REPUBLICANS WERE RIGHTLY WARNING THAT THEY WERE.

REP. BARNEY FRANK, D-MASS.: “I think this is a case where Fannie and Freddie are fundamentally sound, that they are not in danger of going under. They’re not the best investments these days from the long-term standpoint going back. I think they are in good shape going forward.”

So we blew up nearly COMPLETELY BECAUSE OF DEMOCRAT POLICIES. But Democrats along with an ideological mainstream media that is the worse since Joseph Goebbels was the Nazi Minister of Propaganda were ready. They ran on a platform that it happened while Bush was president, and that therefore Bush was entirely responsible for the thing he tried over and over again to fix while Democrats used their power to block those efforts.

Let me just say “Franklin Raines.” Raines as Fannie CEO presided over Enron-style accounting policies and got $90 million in his account because of those corrupt policies. But Raines was the first BLACK CEO of Fannie Mae. And even though he was a Democrat and a Clinton guy, President Bush lacked the courage to push the “first black Fannie Mae CEO” out. Which of course is the same reason that the “first black Fannie Mae CEO” didn’t do hard time in prison where he belonged. “Political correctness” is a demonic device by which liberals protect themselves – usually from going to prison where they ought to go. He got a sweetheart deal basically so Republicans wouldn’t be accused of being racists by
Democrats who of course call them racists no matter what they do. My main point is simply that it was Democrats, Democrats, DEMOCRATS who did this to us.

Morgenson focuses on the managers of Fannie Mae, the government-supported mortgage giant. She writes that CEO James Johnson built Fannie Mae “into the largest and most powerful financial institution in the world.”

But in the process, Morgenson says, the company fudged accounting rules, generated big salaries and bonuses for its executives, used lobby and campaign contributions to bully regulators, and encouraged the risky financial practices that led to the crisis.

Morgenson – again a New York Times writer and not someone from Fox News – said of Fannie Mae on Larry Kudlow’s CNBC program on Monday, June 13: “Whatever Fannie Mae did, everybody else followed.” And of course they all followed right into an economic Armageddon created by Democrats for Democrats.

But who got blamed? Republicans, of course. George Bush and Republicans were to Obama and the Democrats what Emmanual Goldstein was to Big Brother in 1984. George Bush and Republicans were what the Jews were to Adolf Hitler. Fascists always need a bogeyman. And so the people who were truly to blame turned the people who tried futilely to stop them into the scapegoats. All with the mainstream media’s complicity.

The analogy would be holding the police officer who tried but failed to catch the rapist for the rape of the woman rather than holding the actual rapist who raped her responsible. But it was easier to say “This is the result of President Bush’s failed Republican policies” than it was to actually explain the facts to an enraged Attention Deficit Disorder-ridden ignorant pop culture – particularly when virtually no one in the biased mainstream media had any intention whatsoever of telling the truth.

Barack Obama – the ACORN community organizer who pushed these very America-killing policies – ran a demagoguing campaign promising to fix everything.

When adding in all of the money owed to cover future liabilities in entitlement programs the US is actually in worse financial shape than Greece and other debt-laden European countries, Pimco’s Bill Gross told CNBC Monday.

Much of the public focus is on the nation’s public debt, which is $14.3 trillion. But that doesn’t include money guaranteed for Medicare, Medicaid and Social Security, which comes to close to $50 trillion, according to government figures.

The government also is on the hook for other debts such as the programs related to the bailout of the financial system following the crisis of 2008 and 2009, government figures show.

Taken together, Gross puts the total at “nearly $100 trillion,” that while perhaps a bit on the high side, places the country in a highly unenviable fiscal position that he said won’t find a solution overnight.

“To think that we can reduce that within the space of a year or two is not a realistic assumption,” Gross said in a live interview. “That’s much more than Greece, that’s much more than almost any other developed country. We’ve got a problem and we have to get after it quickly.”

Gross spoke following a report that US banks were likely to scale back on their use of Treasurys as collateral against derivatives and other transactions. Bank heads say that move is likely to happen in August as Congress dithers over whether to raise the nation’s debt ceiling, according to a report in the Financial Times.

“We’ve always wondered who will buy Treasurys” after the Federal Reserve purchases the last of its $600 billion to end the second leg of its quantitative easing program later this month, Gross said. “It’s certainly not Pimco and it’s probably not the bond funds of the world.”

Pimco, based in Newport Beach, Calif., manages more than $1.2 trillion in assets and runs the largest bond fund in the world.

Gross confirmed a report Friday that Pimco has marginally increased its Treasurys allotment—from 4 percent to 5 percent—but still has little interest in US debt and its low yields that are in place despite an ugly national balance sheet.

“Why wouldn’t an investor buy Canada with a better balance sheet or Australia with a better balance sheet with interest rates at 1 or 2 or 3 percent higher?” he said. “It simply doesn’t make any sense.”

Should the debt problem in Greece explode into a full-blown crisis—an International Monetary Fund bailout has prevented a full-scale meltdown so far—Gross predicted that German debt, not that of the US, would be the safe-haven of choice for global investors.

America is going down because her stupid citizens wickedly voted for corrupt dishonest Democrat fools – the very fools who imploded our economy – to have complete power. Nancy Pelosi took over dictatorial control in the House of Representatives, and Harry Reid took over the US Senate, in 2006.

Thanks to Obama, America is now worse off than Greece. But that didn’t stop Obama from offering to bail out Greece. Maybe it’s because George Soros is Greek; maybe because the American left has always adored the European-style socialism in spite of Thomas Jefferson’s warning that “the comparison of our governments with those of Europe is like a comparison of heaven and hell.” Maybe because Obama simply WANTS hell for America. But there you have it.

Republicans acknowledged they failed to live up to their values and spent too much. But the last Republican budget (Fiscal Year 2007) passed in 2006 had only a $161 billion deficit. The very next Democrat budget for FY 2008 had a deficit of $459 billion – nearly three times larger than the one they’d demonized Republicans for. Then their FY-2009 budget dwarfed that deficit with a black hold of red ink deficit of $1.4 TRILLION. That was more money than any government in the history of the world had ever contemplated. But Democrats dwarfed that the very next year with a FY-2010 budget with a $1.6 trillion deficit. And as for FY-2011, the Democrat Congress simply refused to perform its most basic duty of governance and didn’t even bother to pass a budget. Republicans are now forced to do the last disgraced Democrat-controlled Congress’ job for them – and Democrats are demonizing them for it.

That’s how this game is played. Democrats are fascist demagogues who shrilly launch into Republicans as they try to save the American people from unparalleled future suffering. They are people who ROUTINELY demonize, demonize, demonize until THEY are the ones forced to call for the very things they demonized and tried to prevent from happening. But by the time they react this time, just as before, it will be too late.

Try this on for size: our actual debt isn’t the $14 trillion we constantly hear about; it’s more like $200 trillion. And even THAT gargantuan number doesn’t take into account the massive debts that all the liberal labor unions have amassed in state pensions (e.g., California’s public pension system has unfunded liabilities of $500 billion). We cannot possibly hope to pay this – and yet Democrats demand more and more and more, and demagogue Republicans for even trying to cut millions when we need to cut TENS OF TRILLIONS or collapse.

Democrats run ads showing a look-a-like of Republican Rep. Paul Ryan pushing an old lady off a cliff; but they want every single senior citizen to die terribly as the Medicare system completely collapses while they refuse to do anything to fix it – as even Bill Clinton openly acknowledged.

We are going to end like the PIIGS – Portugal, Ireland, Italy, Greece and Spain- because we elected Democrat swine to ensure we perished like pigs.

When that happens to us it will be the worst nightmare in history. 300 million Americans are going to go into an insanity of panic – and of course the violence will begin with the left. If you don’t have an arsenal, someone will kick down your door and murder your whole family just to eat the food in your house. And that hell on earth will be entirely because you trusted Democrats like Anthony Weiner to run your health care, your pension, your economy, your life.

I hope you vote in 2012 like your very LIFE was at stake in these elections. Because this time it truly is.

“I am absolutely certain that generations from now, we will be able to look back and tell our children that this was the moment when we began to provide care for the sick and good jobs to the jobless; this was the moment when the rise of the oceans began to slow and our planet began to heal… This was the moment — this was the time — when we came together to remake this great nation …”

– hasn’t seemed to work out very well in the real world. I mean who talks like that but a fascist demagogue promising a false Utopia, anyway? Not that most liberals have any clue whatsoever about the real world, mind you.

The evidence is crystal clear that Obama is a fascist and a demagogue. But the mainstream media is every bit as unlikely to tell the truth about Obama as Joseph Goebbels’ Ministry of Propaganda was likely to tell the truth about their Fuhrer.

The New York Times once said – as part of the irrational fascistic hype surrounding Obama – that:

WASHINGTON — At the core of Senator Barack Obama’s presidential campaign is a promise that he can transcend the starkly red-and-blue politics of the last 15 years, end the partisan and ideological wars and build a new governing majority.

Did Obama ever once come close to actually fulfilling that “core presidential promise”???

President Barack Obama has turned fearmongering into an art form. He has repeatedly raised the specter of another Great Depression. First, he did so to win votes in the November election. He has done so again recently to sway congressional votes for his stimulus package

When [Republican Rep. Eric] Cantor tried to justify his own position, Obama responded: “Elections have consequences, and at the end of the day, I won.”

Were those really the words that would “transcend the starkly red-and-blue politics of the last 15 years”??? In taking that stand, was there actually any chance whatsoever that Obama would “end the partisan and ideological wars”??? Is anyone frankly so morally and intellectually stupid to see these tactics as they way to “build a new governing majority”???

And of course, shortly after the American people rejected Obama in the largest shallacking in modern American history and voted against the Democrat Party in droves, Nancy Pelosi began to further degenerate into fascism (where elections shouldn’t matter unless the fascists win them), saying: “elections shouldn’t matter as much as they do.”

As I said, Obama is a fascist bully and a cynical demagogue. And yet the mainstream media has the unmitigated chutzpah to continue to insanely depict this cynical, lying, hypocrite demagogue as an inspirational figure.

The American people and the mushroom have something in common: both are kept in the dark and fed manure.

So you can understand why the American people – for all the information available to them – are so terribly ignorant about just what the hell is going on in our political system.

But as misinformed and lied-to as Americans are when it comes to the sea of lies they are presented with as “news,” they are still aware that fewer of them have jobs, fewer of them have homes, their food cost more, their fuel cost more and that the quality of their lives are rapidly slipping away under the policies of a failed president and his failed party.

America’s Best DaysThose Confident That America’s Best Days Lie Ahead Down to 31%
Monday, April 25, 2011

Voter confidence that the nation’s best days are still to come has fallen to its lowest level ever.

A new Rasmussen Reports national telephone survey of Likely Voters shows that just 31% believe America’s best days are in the future. That’s down three points from last month and is the lowest result found in polling since late 2006.

Fifty-three percent (53%) believe America’s best days are in the past, also the highest measurement in over four years. Sixteen percent (16%) are undecided. (To see survey question wording, click here.)

Separate polling finds that only 22% of Likely Voters believe the United States is now heading in the right direction. That ties the lowest level found during Barack Obama’s presidency.

While majorities of Republicans (68%) and voters not affiliated with either major political party (52%) believe America’s best days are in the past, a plurality of Democrats (45%) thinks its best days still lie ahead.

Fifty-eight percent (58%) of white voters believe America’s best days have come and gone, but the same number of black voters (58%) feel the opposite is true.

[…]

And of course, it is true: America’s days truly ARE behind us as long as Barack Hussein Obama and as long as Democrats are able to continue to lead. Either Democrats will go down, or America will go down.

But, liberals say, it was BUSH who made the economy fail. Two things: 1) how many years should that line of garbage continue to succeed? And 2) it was never true to begin with (also see here).

Do you know that Democrats had total control of both the House and the Senate from 2006 until 2010???

George Bush tried SEVENTEEN TIMES to warn Congress that unless we got control of the out-of-control Democrat-controlled Fannie Mae and Freddie Mac and the out-of-control housing and housing mortgage market that it was poisoning with piles of bad debt, our economy would go under. The problem had festered because Bush had reappointed the first black Fannie Mae CEO because of political correctness. Franklin Raines was a failure and a corrupt fraud who disguised massive debt. Further, fearing the same political correctness, Republicans had allowed themselves to be repeatedly stymied in their attempts to reform the Government Sponsored Enterprises Fannie and Freddie as Democrats screamd “racism.” John McCain was if anything even more clear in 2006 when there was still time to fix the developing crisis. McCain wrote (in 2006):

Congress chartered Fannie and Freddie to provide access to home financing by maintaining liquidity in the secondary mortgage market. Today, almost half of all mortgages in the U.S. are owned or guaranteed by these GSEs. They are mammoth financial institutions with almost $1.5 Trillion of debt outstanding between them. With the fiscal challenges facing us today (deficits, entitlements, pensions and flood insurance), Congress must ask itself who would actually pay this debt if Fannie or Freddie could not?

McCain asked, “Who would actually pay this massive debt for these incredibly risky liberal policies if Fannie or Freddie could not?’ And we now have the answer to that question, don’t we???

In moving, even tentatively, into this new area of lending, Fannie Mae is taking on significantly more risk, which may not pose any difficulties during flush economic times. But the government-subsidized corporation may run into trouble in an economic downturn, prompting a government rescue similar to that of the savings and loan industry in the 1980′s.

”From the perspective of many people, including me, this is another thrift industry growing up around us,” said Peter Wallison a resident fellow at the American Enterprise Institute. ”If they fail, the government will have to step up and bail them out the way it stepped up and bailed out the thrift industry.”

”These two entities — Fannie Mae and Freddie Mac — are not facing any kind of financial crisis,” said Representative Barney Frank of Massachusetts, the ranking Democrat on the Financial Services Committee. ”The more people exaggerate these problems, the more pressure there is on these companies, the less we will see in terms of affordable housing.”

REP. BARNEY FRANK, D-MASS.: “I think this is a case where Fannie and Freddie are fundamentally sound, that they are not in danger of going under. They’re not the best investments these days from the long-term standpoint going back. I think they are in good shape going forward.

They’re in a housing market. I do think their prospects going forward are very solid.”

John McCain correctly predicted a disaster. Barney Frank was still spouting outrageous lies just one month before the bottom fell out of Fannie Mae and Freddie Mac and then caused the bottom to fall out of the entire economy. Republicans were right and Democrats were disasterously wrong. And the American people responded by electing Democrats and purging Republicans. Because we were lied to, and because we have become a bad people who believe lies.

Democrats blocked every single move by both the Republicans and by George Bush. They actually threatened filibusters to prevent Bush from fixing the broken system that failed and it was DEMOCRATS who took our economy down the drain.

BEIJING: The Chinese economy will surpass that of the US by 2016, the International Monetary Fund ( IMF )) has predicted.According to the IMF’s forecast, based on “purchasing power parities”, China’s gross domestic product (GDP) will rise from $11.2 trillion in 2011 to $19 trillion in 2016, while the American economy will increase from $15.2 trillion to $18.8 trillion.

China’s share of the global economy will ascend from 14 percent to 18 percent, while the US’ share will descend to 17.7 percent, China Daily reported.

The Economist had predicted in December 2010 that China would overtake the US in terms of nominal GDP in 2019.

At the same time all of the other growing disasters is taking place, we have a crisis in the price of oil. And Obama has done nothing but exacerbate that crisis with energy policies that are even more destructive than Jimmy Carter’s.

Do you feel your nation growing smaller and smaller and weaker and weaker? That is the hope and change you voted for.

In the time that Obama has been president, we’ve gone from predicting China would overtake us by 2030, to 2019, to just five years away. And mark my words, it will be moved up yet again, before they overtake Obama’s ignorant stupidity even faster than that.

Under Obama, and due to his immoral and criminally reckless policies, we are spending like fools and at the same time insanely inflating our money supply (under the euphamism of “qantitative easing” or QE2. And here are the results:

The U.S. dollar’s downward slide is accelerating as low interest rates, inflation concerns and the massive federal budget deficit undermine the currency.

With no relief in sight for the dollar on any of those fronts, the downward pressure on the dollar is widely expected to continue.
The dollar fell nearly 1% against a broad basket of currencies this week, following a drop of similar size last week. The ICE U.S. Dollar Index closed at its lowest level since August 2008, before the financial crisis intensified.

“The dollar just hasn’t had anything positive going for it,” said Alessio de Longis, who oversees the Oppenheimer Currency Opportunities Fund.

The United States of America is dangerously close to complete collapse. One wrong move, one piece of bad news, just one thing, could send us into a collapse that will be impossible to stop.

And we are either being led by a total fool, or even worse, we are being led by a man who is actively plotting to collapse America to impose a radical leftwing ideology, and who doesn’t care one iota more about the American people than Adolf Hitler cared about the German people.

I’m sure you have probably picked up on my angry tone. I am angry; I’m beyond angry. Why? Because I see the beast foretold by the book of Daniel and the book of Revelation coming. I see the collapse coming, and the Antichrist riding in on his white horse to save the day. And I see that the same liberals, the same progressives, the same Democrats who caused this collapse will be the ones to welcome this coming world dictator. And it will be these same Democrats who call for the American people to take his mark on their hands or on their foreheads so that they can join the rest of the world and buy and sell.

Would the Last Honest Reporter Please Turn On the Lights?by novelist Orson Scott Card, a Democrat_________
.. This [financial crisis] was completely foreseeable and in fact many people did foresee it. One political party, in Congress and in the executive branch, tried repeatedly to tighten up the rules. The other party blocked every such attempt and tried to loosen them.
..Furthermore, Freddie Mac and Fannie Mae were making political contributions to the very members of Congress who were allowing them to make irresponsible loans. (Though why quasi-federal agencies were allowed to do so baffles me. It’s as if the Pentagon were allowed to contribute to the political campaigns of Congressmen who support increasing their budget.) …
..If you who produce our local daily paper actually had any principles, you would be pounding this story, because the prosperity of all Americans was put at risk by the foolish, short-sighted, politically selfish, and possibly corrupt actions of leading Democrats, including Obama.
..If you who produce our local daily paper had any personal honor, you would find it unbearable to let the American people believe that somehow Republicans were to blame for this crisis. …
..So I ask you now: Do you have any standards at all? Do you even know what honesty means?
..[Was] getting people to vote for Barack Obama so important that you will throw away everything that journalism is supposed to stand for? …
..… tell the truth about John McCain: that he tried, as a Senator, to do what it took to prevent this crisis. You will tell the truth about President Bush: that his administration tried more than once to get Congress to regulate lending in a responsible way.
..This was a Congress-caused crisis, beginning during the Clinton administration, with Democrats leading the way into the crisis and blocking every effort to get out of it in a timely fashion.
..If you at our local daily newspaper continue to let Americans believe — and vote as if — President Bush and the Republicans caused the crisis, then you are joining in that lie. – Novelist Orson Scott Card, a Democrat, on October 5, 2008,HERE
..
.. The Financial Sector Meltdown .. 1. Almost all of the financial problems we see today are based on bad mortgage lending. That would be lending money to people to buy homes who didn’t qualify for a loan.
.. 2. The Democrats, under Clinton, strengthened a government-created monster called the “Community Reinvestment Act” [first foisted upon the country under Jimmy Carter]. This law was then used by “activists” and “community organizers” … to coerce lending institutions to make these bad loans … millions of them.
.. 3. Now we see what happens when political “wisdom” supplants good loan underwriting. When private financial institutions are virtually forced to make loans to people with a bad credit and job history … this is what you get. Enjoy it. — Neal Boortz, here ..

.
Enough cards on this table have been turned over that the story is now clear. The economic history books will describe this episode in simple and understandable terms: Fannie Mae and Freddie Mac exploded, and many bystanders were injured in the blast, some fatally.
..
Fannie and Freddie did this by becoming a key enabler of the mortgage crisis. They fueled Wall Street’s efforts to securitize subprime loans by becoming the primary customer of all AAA-rated subprime-mortgage pools. In addition, they held an enormous portfolio of mortgages themselves.
..
In the times that Fannie and Freddie couldn’t make the market, they became the market.
.. — Kevin Hassett, Bloomberg News, here ..

.. Obama choice helped Fannie block oversight
National security adviser tied to discrediting of probe ..
By Jim McElhatton, The Washington Times,October 13, 2010here
..
UNDER SCRUTINY: Thomas E. Donilon worked as a registered lobbyist for Fannie Mae from 1999 to 2005.
..
Years before Fannie Mae foundered amid a massive accounting scandal, President Obama’s choice for national security adviser oversaw an office inside the mortgage giant that orchestrated a negative publicity blitz to fight attempts by Congress to increase government oversight, records show.
..
Thomas E. Donilon, who won the job as national security adviser this month, worked as a registered lobbyist for Fannie Mae from 1999 to 2005 at a time the company’s officials insisted finances were sound. He also earned more than $1.8 million in bonuses [from Frannie Mae] before the government took over the troubled company in the wake of an accounting scandal.
..
Vice President Joseph R. Biden Jr. and Mr. Obama, who railed against lobbyists on the campaign trail, hailed Mr. Donilon’s appointment last week, but made no mention of his time as a registered lobbyist.st wee
..

..
Democrats and some [big-government] Republicans opposed reform in part because Fannie and Freddie were very good at greasing palms. Fannie has spent $170 million on lobbying since 1998 and $19.3 million on political contributions since 1990.
..
The principal recipient of Fannie Mae’s largesse was a Democrat, Sen. Chris Dodd (D, CT), chairman of the Senate Banking Committee. No. 2 was another Democrat, Sen. Barack Obama (D, IL).
..
Mr. Dodd was also the second largest recipient in the Senate of contributions from Countrywide’s political action committee and its employees, and the recipient of a home loan from Countrywide at well below market rates. The No. 1 senator on Countrywide’s list? Barack Obama. Check it out here: http://tinyurl.com/4h9955
..

..“Congressman Frank and Senator Dodd wanted the government to push financial institutions to lend to people they would not lend to otherwise, because of the risk of default.
..“The idea that politicians can assess risks better than people who have spent their whole careers assessing risks should have been so obviously absurd that no one would take it seriously.” — Dr. Thomas Sowell, Professor Emeritus, Economics, Stanford University, HERE
..

.. When the Bush administration tried to rein in Freddie and Fannie from continuing to engage in risky practices, guess who stepped in to block their efforts? Democratic senators Chris Dodd, John Kerry, Hillary Clinton, and — are you ready? — Barack Obama.
..Meanwhile, guess who were the top four recipients of campaign contributions from Fannie and Freddie between 1988 and 2008?
..Senators Chris Dodd, John Kerry, Hillary Clinton, and — still ready? — Barack Obama.
..A coincidence, I tell you — just a coincidence.
..More mere coincidences: Franklin Raines — a former Carter- and Clinton-administration official and former head of Fannie Mae, now under investigation for cooking its books — had a lot of powerful people in Congress beholden to his agency. Here is a list of his campaign-contribution recipients. Meanwhile, Democratic honcho Jim Johnson, another former Fannie Mae CEO, has been an economic adviser to and major fundraiser for Barack Obama, and even ran his vice-presidential search committee until growing scandals over his Fannie management forced him to step down in July. – Robert Bidinotto, here ..

.. On May 25, 2006, Sen. John McCain spoke forcefully on behalf of the Federal Housing Enterprise Regulatory Reform Act of 2005. He said on the floor of the Senate:
.. “Mr. President, this week Fannie Mae’s regulator reported that the company’s quarterly reports of profit growth over the past few years were “illusions deliberately and systematically created” by the company’s senior management, which resulted in a $10.6 billion accounting scandal.
.. “The Office of Federal Housing Enterprise Oversight’s report goes on to say that Fannie Mae employees deliberately and intentionally manipulated financial reports to hit earnings targets in order to trigger bonuses for senior executives. In the case of Franklin Raines, Fannie Mae’s former chief executive officer, OFHEO’s report shows that over half of Mr. Raines’ compensation for the 6 years through 2003 was directly tied to meeting earnings targets. The report of financial misconduct at Fannie Mae echoes the deeply troubling $5 billion profit restatement at Freddie Mac.
.. ” The OFHEO report also states that Fannie Mae used its political power to lobby Congress in an effort to interfere with the regulator’s examination of the company’s accounting problems. This report comes some weeks after Freddie Mac paid a record $3.8 million fine in a settlement with the Federal Election Commission and restated lobbying disclosure reports from 2004 to 2005. These are entities that have demonstrated over and over again that they are deeply in need of reform.
.. “For years I have been concerned about the regulatory structure that governs Fannie Mae and Freddie Mac–known as Government-sponsored entities or GSEs–and the sheer magnitude of these companies and the role they play in the housing market. OFHEO’s report this week does nothing to ease these concerns. In fact, the report does quite the contrary. OFHEO’s report solidifies my view that the GSEs need to be reformed without delay.
.. “I join as a cosponsor of the Federal Housing Enterprise Regulatory Reform Act of 2005, S. 190, to underscore my support for quick passage of GSE regulatory reform legislation. If Congress does not act, American taxpayers will continue to be exposed to the enormous risk that Fannie Mae and Freddie Mac pose to the housing market, the overall financial system, and the economy as a whole.
.. “I urge my colleagues to support swift action on this GSE reform legislation.”
..It died at the hands of the DEMOCRATS — HERE’s a video clip showing their anger.
..

.. “Many politicians and pundits claim that the credit crunch and high mortgage foreclosure rate is an example of market failure and want government to step in to bail out creditors and borrowers at the expense of taxpayers who prudently managed their affairs.These financial problems are not market failures but government failure. … The credit crunch and foreclosure problems are failures of government policy.” — Dr. Walter E. Williams, the John M. Olin distinguished professor of economics at George Mason University, HERE
..

.. “Barack Obama wasn’t just the second-largest recipient of Fannie Mae and Freddie Mac political contributions. He was also the senator from ACORN, the activist leader for risky ‘affirmative action’ loans. … [The CRA] gave groups such as ACORN a license and a means to intimidate banks … ACORN employed its tactics in 1991 by taking over the House Banking Committee room for two days to protest efforts to scale back the CRA. … Obama represented ACORN in a 1994 suit against redlining. ACORN was also a driving force behind a 1995 regulatory revision pushed through by the Clinton administration that greatly expanded the CRA and helped spawn the current financial crisis. Obama was the attorney representing ACORN in this effort.” — IBD Editorials
.. “The Woods Fund report makes it clear Obama was fully aware of the intimidation tactics used by ACORN’s Madeline Talbott in her pioneering [“community organizer”] efforts to force banks to suspend their usual credit standards. Yet he supported Talbott in every conceivable way. He trained her personal staff and other aspiring ACORN leaders, he consulted with her extensively, and he arranged a major boost in foundation funding [via CAC and Woods Fund] for her efforts.” — Stanley Kurtz, “BARACK’S ‘ORGAANIZER’ BUDS PUSHED FOR BAD MORTGAGES”HERE
.

.Bloomberg News has an excellent recap of the history of the financial meltdown:.HERE.
.

“Scratch the surface of an endemic problem — famine, illness, poverty — and you invariably find a politician at the source.” — Simon Carr

“One of the methods used by statists to destroy capitalism consists in establishing controls that tie a given industry hand and foot, making it unable to solve its problems, then declaring that freedom has failed and stronger controls are necessary.” — Ayn Rand

“I think that we all need to consider the possibility … just the possibility … that Obama is engaged in a conscious effort to destroy our free market economy so that he can build a government-controlled socialist party on the rubble.” — Neal Boortz, here
[Conscious effort or not, we have an emergency on our hands.]

Democrats still don’t get it, and they refuse to reform Fannie Mae and Freddie Mac, the government mortgage companies that sparked the meltdown by giving high-risk loans to people who couldn’t afford it. Standing up for American taxpayers, CNBC’s on-air editor, Rick Santelli teed off on Rep. Paul Kanjorski’s (D-PA) claim that Democrats’ couldn’t reform Fannie & Freddie in their financial regulation bill because it was “too complicated,” asking: “It’s too complicated? You think taxpayers that go to work to pay the money you are subsidizing, it will end up a half a trillion, do you think they think complicated is an excuse?”

The exchange couldn’t have come at a worse time for Rep. Kanjorski and Congressional Democrats, because Fannie and Freddie simply won’t go away. As the Financial Times reported today:

“Fannie Mae said on Monday it would need an additional $8.4bn in aid, as the US government-controlled mortgage finance company continued to suffer heavy losses on its bad loans…Fannie Mae’s appeal for help comes on the heels of a similar plea last week by smaller rival Freddie Mac, which asked for an additional $10.6bn cash infusion. The latest requests for aid bring the total amount of taxpayer dollars drawn down by these companies to $148bn since the 2008 government-led bail-out.

“Anthony Sanders, a senior scholar at the Mercatus Center at George Mason University, called Fannie and Freddie ‘our own Greek tragedy.’ Mr. Sanders estimated that total taxpayer liability was about $8,000bn for the combined companies, including public debt and loan guarantees.”

But the unlimited bailout that the Administration has bestowed on Fannie and Freddie doesn’t seem to bother Democrats, though the latest giveaway may come at an “inconvenient time,” as the New York Times noted today:

“Fannie Mae’s request on Monday for another $8.4 billion in federal aid comes at a politically inconvenient time for the Obama administration, which is pressing to pass sweeping financial legislation without resolving the company’s future…. Democrats want to defer an overhaul of federal housing policy until next year, after the midterm elections. But Republicans have seized on the continuing losses to argue that a plan for the two companies should be a priority of the current legislation.”

Republicans have been pressing for an end to bailouts that would get the government out of the mortgage business once and for all. But Democrats are not only unwilling to reform Fannie and Freddie, they are doubling down on the failed government mortgage companies – burning through hundreds of billions of taxpayer dollars in the process. As the Washington Post noted in a report today: “Under the terms of the government’s 2008 emergency takeover of Fannie and Freddie, the Treasury must pump money into either firm whenever its worth, as measured by assets minus liabilities, goes into the red. Late last year, the Obama administration pledged unlimited backing.”

For years, Republicans raised red flags about Fannie and Freddie’s financial condition and proposed responsible reforms only to be thwarted by Democrats who have deep political ties to the worst offenders. These same powerful Democrats are now pushing for a financial reform bill that doesn’t even address the need to fix these government mortgage companies. As the Wall Street Journal wrote last week, “reforming the financial system without fixing Fannie and Freddie is like declaring a war on terror and ignoring al Qaeda.”

House Republicans’ plan would phase out taxpayer subsidies of Fannie Mae and Freddie Mac over a number of years and end the current model of privatized profits and taxpayer losses. Find out more by clicking HERE.

For the record, “8,000 billion” is another way of saying $8 TRILLION DOLLARS. That’s what Fannie Mae, Freddie Mac, and the Democrat Party have cost us.

The biggest problem with Fannie Mae and Freddie Mac has always been that it was a social welfare institution disingenuously masquerading as a financial institution. The giant GSEs were packaged and sold under entirely false pretenses.

REP. BARNEY FRANK, D-MASS, July 14, 2008: I think this is a case where Fannie and Freddie are fundamentally sound, that they are not in danger of going under. They’re not the best investments these days from the long-term standpoint going back. I think they are in good shape going forward.

And I think that anybody who respects what you think is a deluded and deranged dumbass, Mr. Frank.

Fannie Mae and Freddie Mac are now in control of 96.5% of all mortgages, for those who don’t think they’re all that important in their role of creating the mortgage meltdown. It was Fannie and Freddie that bundled all the bad mortgages into mortgage-backed securities and then sold the mortgage-backed and debt securities to domestic and international capital investors under the illusion that they were guaranteed by the federal government.

Just how bad is the news at Fannie/Freddie? On Friday morning, Moody’s downgraded their outstanding preferred stock 5 notches from A1 to Baa3 (a slight gradation above junk) and their Bank Financial Strength Ratings (BSFR) to D+ from B- (one/half notch above D, which is reserved for companies in default). […]

When the Treasury peels back the onion, I believe they will find a hornet’s nest. I think we will see an initial bailout of $100 billion or so, with 2/3-3/4 going to Fannie (as it is a larger organization). The scenario I foresee however, just as happened at Merrill Lynch, Lehman Brothers and Morgan Stanley, is that they came to the financing window expecting to have borrowed enough, but then find they have to keep coming back repeatedly until the buyers go away or until “We The People” have thrown at least $500 billion at Fannie/Freddie to get them back on their feet again. This will also likely take an Act of Congress to raise the Treasury’s Debt ceiling quite dramatically

The United States used to be the greatest nation in the history of the world; now we’re more like a chicken that has had its head cut off, but is too disconnected from reality to know that it’s already dead.

University of Maryland senior research scientist John Lott Jr. says news coverage of the economy is slanted. Lott writes, “Over 78 percent more negative news stories discussed a recession when the economy — under a Republican president was soaring than occurred under a Democrat when the economy was shrinking.”

Lott — who researched 12,500 newspaper and wire service articles from 1985 through 2004 — also found that Democratic presidents got positive headlines 15 percent more of the time than Republican presidents for the same economic news.

Of his findings Lott writes, “The media’s focus on the negative side of everything surely helps explain people’s pessimism… Indeed, research has indicated that media bias is real.”

The media helped Obama fearmonger the economy when he wanted them to fearmonger the economy to push through his stimulus; but now they’re are trying to talk up the economy when Obama wants them to talk up the economy. They are dutifully reporting that the recession seems to be over.

Failed banks tend to be smaller and private, which exacerbates the problem for small business borrowers, said Kanas, who became CEO of BankUnited when his firm bought the bank and is the former chairman and CEO of North Fork bank.

“Government money has propped up the very large institutions as a result of the stimulus package,” he said. “There’s really very little lifeline available for the small institutions that are suffering.”

This comes at a time when the FDIC has established new rules on bank sales. Private equity, for instance, would have to hold double the capital of their competitors in order to buy such an institution, said Kanas.

“This will have somewhat of a chilling effect on our participation,” he said. “As a result of having to keep higher capital levels, we’ll see lower prices coming from that sector.”

Of the 81 failed banks this year, two have been successfully acquired by private equity, he said. Kanas’ private equity firm bought UnitedBank, the failed Florida-based bank, from the FDIC in May. Regulators also allowed the sale of IndyMac Bank of California earlier this year.

“We are seeing more people step up and lobby bids in this situation,” he said. “We’re seeing more players mostly as a result of being attracted to the sector. I’m not so sure that will continue now that the rules have been ratchet it up.”

Meanwhile, much of the commercial realty problem resides in the regional and small community banks, said Kanas, because larger banks haven’t fueled that sector in the past.

“The market is expecting about the way we were expecting,” he said. “Unfortunately, we’re not seeing any evidence of a recovery in the real estate market in the southern Florida market,” he said.

It’s rather interesting that there’s a strong argument that Obama’s regulations are actually hurting our recovery, but Obama doesn’t have to worry about that message getting out to the public. His secret, clearly, is completely safe with the mainstream media.

March 4 (Bloomberg) — Federal Deposit Insurance Corp. Chairman Sheila Bair said the fund it uses to protect customer deposits at U.S. banks could dry up amid a surge in bank failures, as she responded to an industry outcry against new fees approved by the agency.

And think about it: one thousand banks failing over the next two years is to the notion of “economic recovery” what a giant asteroid hurtling toward us from space is to the statement “things are looking up for us.” But again, the mainstream media is so focused on talking up the economy that they don’t have much time for such distractions.

Unemployment is likely to rise to 13 percent or higher and will weigh on the economy for several years, countering government efforts to stabilize the banking industry, analyst Meredith Whitney told CNBC.

While Whitney raised her short-term outlook for banks, causing stocks to open in positive territory after pointing lower earlier, she said the long-term outlook for the economy remains murky.

Consumers will not be able to spend as they continue to lose jobs and credit conditions stay tight, she said in a live interview. The result will provide a vivid display of how critical housing and lending are to economic growth. Unemployment is currently at 9.5 percent but is expected to keep rising.

“We underestimate how much the whole economy is dependent on the mortgage industry, and that has to change,” Whitney said. “This is what happens when you delay the inevitable. We’re buying time here, but we’re not restructuring the economy.”

The dire assessment comes amid a slight stabilization in the U.S. housing market after three years of price drops, according to the National Association of Realtors.

The report states that the drop in home prices is fueling a vicious cycle of foreclosures as it eliminates homeowner equity and gives borrowers an incentive to walk away from their mortgage.

But, the foreclosed homes are not coming onto the market because people are finding out they can stay living in them and not pay their mortgage, according to Kudrle.

“The Obama administration is putting so much pressure on the banks and lenders to slow down the foreclosure process to try and keep people in their homes,” Kudrle said. “We have people who have not made a payment for 12 to 18 months and the bank still hasn’t come in to foreclose.”

That’s not a policy that is going to correct our financial woes; it’s just a delaying tactic that will ultimately make a bad problem far, far worse by postponing and in fact stockpiling the coming misery.

”From the perspective of many people, including me, this is another thrift industry growing up around us,” said Peter Wallison a resident fellow at the American Enterprise Institute. ”If they fail, the government will have to step up and bail them out the way it stepped up and bailed out the thrift industry.” . . .

Franklin Raines, Jamie Gorelick, Jim Johnson, Daniel Mudd. That’s just part of your list of Democrats who ran Fannie Mae into the ground and profited wildly in doing so. The Wall Street Journal cites the first three names for disgrace in the Fannie Mae Enron-scheme they produced. The fourth figure, Fannie CEO Daniel Mudd, showed just how far to the left Fannie Mae was politically when he said to THE most radically liberal wing of the Democrat Party – the Congressional Black Caucus – the following:

So many of you have been good friends to Fannie Mae and our mission. You’ve been friends through thick and thin. We have indeed come upon a difficult time for Fannie Mae… In many ways I want to tell you today you are also the conscience of Fannie Mae.

President Bush tried SEVENTEEN TIMES to create tighter regulation of the government-sponsored enterprises (GSEs) Fannie Mae and Freddie Mac.

Bush’s efforts led to two major Republican efforts to push through regulations that would have limited the mess that Fannie and Freddie could create, but their every move was fiercely resisted by Democrats. The first time, Barney Frank – leading the Democratic effort to shield Fannie and Freddie from necessary regulatory reform in 2003, said:

”These two entities — Fannie Mae and Freddie Mac — are not facing any kind of financial crisis,” said Representative Barney Frank of Massachusetts, the ranking Democrat on the Financial Services Committee. ”The more people exaggerate these problems, the more pressure there is on these companies, the less we will see in terms of affordable housing.”

Again, in 2005, Republicans tried and failed to establish necessary regulatory reforms of Fannie Mae and Freddie Mac at a time when reforms could have averted the 2008 disaster. Again Democrats unanimously rose up to block any such effort. John McCain warned:

If Congress does not act, American taxpayers will continue to be exposed to the enormous risk that Fannie Mae and Freddie Mac pose to the housing market, the overall financial system, and the economy as a whole.

But Democrats refused to heed the warnings. And when the economy DID collapse BECAUSE of their refusal to deal with the GSEs that they had politically-benefited from, the very people who created the disaster in the first place poised themselves to benefit from it by demagoguing Republicans whose greatest sin was not being strong enough in their efforts to stand up and stop Democrats from advancing a ruinous agenda.

Think about it: seventeen calls for regulatory reform of the housing mortgage industry, all resisted by Democrats. Two major efforts at regulatory reform, both blocked by fierce and united Democrat opposition. And then Democrats demonized Republicans for refusing to enact regulations. That’s called ‘chutzpah.’ And when the mainline media reported it as if it were somehow true, it was called ‘propaganda.’

From where does the Statist acquire his clairvoyance in determining what is good for the public? From his ideology. The Statist is constantly manipulating public sentiment in a steady effort to disestablish the free market, as he pushes the nation down tyranny’s road. He has built an enormous maze of government agencies and programs, which grow inexorably from year to year, and which intervene in and interfere with the free market. And when the Statist’s central planners create economic perversions that are seriously detrimental to the public, he blames the free market and insists on seizing additional authority to correct the failures created at his own direction.

Consider the four basic events that led to the housing bust of 2008, which spread to the financial markets and beyond:

EVENT 1: In 1977, Congress passed the Community Reinvestment Act (CRA) to address alleged discrimination by banks in making loans to poor people and minorities in the inner cities (redlining). The act provided that banks have “an affirmative obligation” to meet the credit needs of the communities in which they are chartered.1In 1989, Congress amended the Home Mortgage Disclosure Act requiring banks to collect racial data on mortgage applications.2 University of Texas economics professor Stan Liebowitz has written that “minority mortgage applications were rejected more frequently than other applications, but the overwhelming reason wasn’t racial discrimination, but simply that minorities tend to have weaker finances.”3 Liebowitz also condemns a 1992 study conducted by the Boston Federal Reserve Bank that alleged systemic discrimination. “That study was tremendously flawed. A colleague and I … showed that the data it had used contained thousands of egregious typos, such as loans with negative interest rates. Our study found no evidence of discrimination.”4 However, the study became the standard on which government policy was based.

In 1995, the Clinton administration’s Treasury Department issued regulations tracking loans by neighborhoods, income groups, and races to rate the performance of banks. The ratings were used by regulators to determine whether the government would approve bank mergers, acquisitions, and new branches.5 The regulations also encouraged Statist-aligned groups, such as the Association of Community Organizations for Reform Now (ACORN) and the Neighborhood Assistance Corporation of America, to file petitions with regulators, or threaten to, to slow or even prevent banks from conducting their business by challenging the extent to which banks were issuing these loans. With such powerful leverage over banks, some groups were able, in effect, to legally extort banks to make huge pools of money available to the groups, money they in turn used to make loans. The banks and community groups issued loans to low-income individuals who often had bad credit or insufficient income. And these loans, which became known as “subprime” loans, made available 100 percent financing, did not always require the use of credit scores, and were even made without documenting income.6 Therefore, the government insisted that banks, particularly those that wanted to expand, abandon traditional underwriting standards. One estimate puts the figure of CRA-eligible loans at $4.5 trillion.7

EVENT 2: In 1992, the Department of Housing and Urban Development pressured two government-chartered corporations – known as Freddie Mac and Fannie Mae – to purchase (or “securitize”) large bundles of these loans for the conflicting purposes of diversifying the risks and making even more money available to banks to make further risky loans. Congress also passed the Federal Housing Enterprises Financial Safety and Soundness Act, eventually mandating that these companies buy 45% of all loans from people of low and moderate incomes.8 Consequently, a SECONDARY MARKET was created for these loans. And in 1995, the Treasury Department established the Community Development Financial Institutions Fund, which provided banks with tax dollars to encourage even more risky loans.

For the Statist, however, this was still not enough. Top congressional Democrats, including Representative Barney Frank (Massachusetts), Senator Christopher Dodd (Connecticut), and Senator Charles Schumer (New York), among others, repeatedly ignored warnings of pending disaster, insisting that they were overstated, and opposed efforts to force Freddie Mac and Fannie Mae to comply with usual business and oversight practices.9 And the top executives of these corporations, most of whom had worked in or with Democratic administrations, resisted reform while they were actively cooking the books in order to award themselves tens of millions of dollars in bonuses.10

EVENT 3: A by-product of this government intervention and social engineering was a financial instrument called the “derivative,” which turned the subprime mortgage market into a ticking time bomb that could magnify the housing bust by orders of magnitude. A derivative is a contract where one party sells the risk associated with the mortgage to another party in exchange for payments to that company based on the value of the mortgage. In some cases, investors who did not even make the loans would bet on whether the loans would be subject to default. Although imprecise, perhaps derivatives in this context can best be understood as a form of insurance. Derivatives allowed commercial and investment banks, individual companies, and private investors to further spread – and ultimately multiply – the risk associated with their mortgages. Certain financial and insurance institutions invested heavily in derivatives, such as American International Group (AIG).11

EVENT 4: The Federal Reserve Board’s role in the housing boom-and-bust cannot be overstated. The Pacific Research Institute’s Robert P. Murphy explains that “[the Federal Reserve] slashed rates repeatedly starting in January 2001, from 6.5 percent until they reached a low in June 2003 of 1.0 percent. (In nominal terms, this was the lowest the target rate had been in the entire data series maintained by the St. Louis Federal Reserve, going back to 1982)…. When the easy-money policy became too inflationary for comfort, the Fed (under [Alan] Greenspan and the then new Chairman Ben Bernanke at the end) began a steady process of raising interest rates back up, from 1.0 percent in June 2004 to 5.25 percent in June 2006….”12 Therefore, when the Federal Reserve abandoned its role as steward of the monetary system and used interest rates to artificially and inappropriately manipulate the housing market, it interfered with normal market conditions and contributed to destabilizing the economy.

The last couple weeks may well be a harbinger of things to come, as the people Obama promised to tax heavily continue to pull out of the market. On November 4, the Dow closed at 9,625; today, it was at 8,497. That means that the market has lost nearly 12% of its value since Obama became President-elect. Hardly a measure of confidence.

NEW YORK, Nov 5 (Reuters) - Wall Street hardly delivered a
rousing welcome to President-elect Barack Obama on Wednesday,
dropping by the largest margin on record for a day following a U.S.
presidential contest.

The slide more than wiped out the previous day's advance, the
largest Election Day rally ever for U.S. stocks.

The people who invest, and create job opportunities, and build the economy, don’t want to have their wealth redistributed. Would you want your wealth redistributed?

Democratic apologists point out that Obama promises on a meager jump in the top federal tax rates from 36% to 39%. But that “insignificant” 3% comes right out of peoples’ profits. It sounds a lot worse when the reality is understood: when businesses that had been making an 11% profit are now reduced to an 8% profit. Or an 8% profit reduced to a 5% profit. And Obama promises to increase capital gains taxes and several other taxes that will impact upon businesses and the investment climate that supports business. How hard are job creators willing to work to experience a diminishing return on their time, labor, and risk?

Time Magazine – a publication that has gushed over Obama for months – has a new gushing cover:

It should frighten you. FDR was no “moderate.” He presided over a terrible time for the country, and – while he was a popular figure because of what he tried to do – his actual economic administration has been widely recognized by economists to have been a failure. Studies have demonstrated that the average depression lasted only four years; but for some reason the Great Depression dragged on and on and on under FDR’s governance. By 1938, after more than four years of FDR, the effects of the Depression were actually much worse than they had been when he first took office.

Two UCLA economists say they have figured out why the Great Depression dragged on for almost 15 years, and they blame a suspect previously thought to be beyond reproach: President Franklin D. Roosevelt.

After scrutinizing Roosevelt’s record for four years, Harold L. Cole and Lee E. Ohanian conclude in a new study that New Deal policies signed into law 71 years ago thwarted economic recovery for seven long years.

Even the common man’s sense has largely been that World War II had more to do with getting us out of the Depression than FDR’s New Deal. It certainly did get men who had been standing in bread lines put to “work.” And as the nation coalesced together and began to pour resources into building weapons, factories that had been idled came back on line, and innovation increased to match the technological development of our enemies. And certainly, the fact that, when hostilities ended, the United States alone was not reduced to rubble had a great deal to do with helping our economy surge forward.

But by that thinking, anyone who criticized President Bush’s wars in Afghanistan and Iraq is correct only insofar as we need an even BIGGER war. For Obama to truly be like FDR, we need to have a devastating Depression that drags on for 12 years while incompetent liberals continue to tinker, and then we need slug it out in World War III against Russia and China.

So pardon me for looking at the “New New Deal” FDR-lookalike Barack Obama and shuddering down to the marrow of my bones.

We’re watching the market beginning to go down the slide. It’s going to go down a lot more. And fear over Barack Obama’s policies is going to have a lot to do with the lack of confidence that keeps investment from pouring back into the economy.

The picture is far more frightening than the story the media is telling: there are more than $700 trillion in derivatives in the global economy. That’s far more than the total currencies of all the governments in the entire world. As one writer puts it, “In other words, every dollar of insurance on bonds issued by some deadbeat governments and corporations is leveraged 200 times!” We’ve got a time bomb waiting to explode. And we put a lot of the people who created that time bomb in the first place in charge of fixing the mess they themselves created. People like Obama’s National Finance Chair, Penny Pritzker, who was at the epicenter of the subprime loan scandal and once paid $460 million to stay out of jail. People like Jim Johnson, Franklin Raines, and Jamie Gorelick, who pocketed over $300 million from Fannie and Freddie while juggling the books so they could get their bonuses. People like Barney Frank, who claimed that nothing was wrong with Fannie and Freddie and the housing market they supervised, and repeatedly fought off President Bush’s efforts to regulate them at time when the crisis we are currently experiencing could have been averted. People like Charles Schumer, who exemplified the sheer hypocrisy of the Democratic Party with his blaming others for what he himself did. People like Joe Biden, whom two major studies said shared direct blame for the foreclosure disaster because of legislation he championed as the Senator from banking-capital Delaware. And people like Barack Obama, who embraced more contributions from Fannie and Freddie – and from scandal-plagued finance institutions such as Lehman Brothers than anyone during his short time in the Senate. Now all these people have been entrusted with fixing a mess of literally global proportions; a mess that they in large part created in the first place.

And Barack Obama wearing the “New New Deal” mantle of FDR’s Panama hat, glasses, and fancy cigarette is not going to make that time bomb go away. In fact, it may be the very thing that brings the whole house of cards come crashing down.

The Joe the Plumber issue began with Barack Obama having a conversation with a plumber who planned to buy his employers’ business, but realized with concern that he would be paying much higher taxes under Obama’s plan. Obama responded:

“It’s not that I want to punish your success. I just want to make sure that everybody who is behind you, that they’ve got a chance for success too,” Obama responded. “My attitude is that if the economy’s good for folks from the bottom up, it’s gonna be good for everybody … I think when you spread the wealth around, it’s good for everybody.”

Please realize: we’re talking about a PLUMBER and a SMALL BUSINESS – not a Wall Street tycoon or a big corproation. He would pay more in taxes under Obama’s plan. It turns out that half of the over 8 million taxpayers in the top 5% of income earners are small business owners. And it is small business owners who are and have been the engine of the economy and who are hiring the most workers. All the small businesses that are driving that engine – the businesses that employ at least 20 workers – would pay more taxes under Obama’s plan.

Obama keeps claiming that he’ll cut taxes for 95% of Americans. but about 40% of Americans don’t pay federal taxes. Obama will give these free riders an IRS welfare check paid for by taxpayers, amounting to nearly $400 billion dollars a year. Obama’s tax credit goodies will be “fully refundable,” which is taxspeak for government payments that do not require a tax liability on the part of recipients in order to be paid out. This is a transfer payment, a transfer of wealth, and socialism.

Corporations don’t pay taxes; they pass them on to you through higher prices. Obama’s tax increase on corporations will amount to a de facto higher cost of living for you. To the extent that it cuts into their profits, corproations will increasingly outsource jobs to save on labor costs, or they will simply relocate their operations to countries with lower corporate tax structures (that currently means anywhere on the planet except Japan unless taxes are lowered here).

If you want corporations and businesses to hire more workers and provide goods and services at low prices, you have to lower their tax burdens. You don’t create an incentive to hire more workers when you increase their costs of doing business.

“Spread the wealth around,” Obama says. From each according to his ability, to each according to his need. Bottom line, if you design a system which does not sufficiently reward people based on allowing them to enjoy the fruits of their hard work, than no one will have incentive to work hard. The hard worker will eventually get tired of working for the lazy person unless he can keep what he produces for the benefit of himself and his family.

In Europe, the steep rates create a disincentive to continue working. If you have to pay skyhigh taxes after $200,000 (as a single filer in Obama’s plan), why keep working hard after you’ve made your $200,000? Obama will confiscate most of your profits (for New Yorkers, as an example, it would be 65 cents of every dollar!). If you’re a small business owner, you have good reason to simply shut down and take a long vacation until next April. We don’t want that here.

Investors’ Business Daily describes Obama as “the most anti-capitalist politician ever nominated by a major party.” And for good reason. Sadly, the media has largely given inspection of Obama’s economic and tax plans a pass. The specifics are largely unknown to the American people. Barack Obama will regard the recent socializing of much of our financial system as a leaping-off point.

Obama is claiming that his plan will save money. It won’t. It has been tried, and it has failed. He is overestimating the “savings” of his plan, and massively underestimating the costs.

Barack Obama’s health care plan is estimated to cost $1.6 trillion in 10 years. And that’s if everything goes wll. But it won’t go well. The numbers don’t take into account the very sort of cost overruns and cost increases that are even now plaguing the very state that Obama is basing his own plan upon. What is going to happen to our economy given the extremely real likelihood that Obama’s massive national plan runs into similar issues? Do you believe our economy is strong enough to bear the brunt of these massive cost increases?

You need to understand something else that emerged from the second debate: is health care a privilege, a right, or a responsibility? Obama answered “It should be a right.” What does that mean? It means that a government has a fundamental duty to guarantee me my health care the same way it has a duty to guarantee me right to free speech or my right to assembly. You have a constitutional, government-imposed duty to give me health care – no matter what – regardless of how much it costs you and your family to do so. Am I an alcoholic who needs a liver transplant? You owe me a new liver. As an American citizen (or an illegal immigrant, under Obama’s plan) I have a right to that liver. Did I sustain a brain injury riding my motorcycle without a helmet because I like to feel the wind in my hair? Doesn’t matter. Do I want a sex change? Give it to me! I have a fundamental constitutional right to that liver, or to that brain surgery and all the long months of incredibly expensive therapy, or to my sex change operation. I also have a right to years of incredibly expensive psychological counseling with highly paid professionals. And if I have any pre-existing conditions, you still have to cover me (and illegal immigrants because we don’t deny fundamental rights to anyone in the United States, even if they are here illegally), no matter what.

Do you understand how expensive this can all get?

Do you understand that Barack Obama is essentially talking about socializing a quarter of our economy? Do you trust your government’s track record to do that?

On the mortgage industry collapse:

Neither candidate brought up the fact that there was a gigantic elephant in the room. And it was ridiculous. A lot of people are livid over this collapse and the subsequent $850 billion bailout package Congress approved. But Democrats are all over this. From their passage of the Community Reinvestment Act, to Bill Clinton’s radical expansion of the program (particularly in the last two years of his 2nd administration); to the almost exclusively Democratic leadership of Government Supported Enterprises Fannie Mae and Freddie Mac (e.g. Jim Johnson, Franklin Raines, and Jamie Gorelick who collectively took over $300 million from the GSEs even as they played around with the books); to the repreated stubborn refusal of congressional Democrats to regulate Fannie and Freddie during the first six years of President Bush’s presidency.

Barney Frank repeatedly said that Fannie and Freddie were fine, and that regulation was unnecessary. The last time was on July 14, 2008 – only a couple months before they went belly up. He assured the American people – and American investors – that Fannie and Freddie stock were strong going forward. The stock of Fannie and Freddie and declined 90% during the Democrats’ watch. And oversight of Fannie and Freddie was Congress’ job, NOT President Bush’s.

This was a Democrat-created disaster.

And the level of propagandizing and demagoguery blaming Republicans for “the failed policies of the last 8 years” has reached a level of deceit not seen since Hitler blamed the Jews for all of Germany’s problems.

It is for this reason that I will refuse to support a President Obama or any country that elects him to lead it. If the American people vote for Barack Obama, I will agree with Jeremiah Wright to this extent: “No, no, no. Not God bless America. God damn America!” God damn an America that would vote for a certified baby killer.

Conclusion:

Our already-most-expensive education system in the world (around $65 billion a year) that isn’t producing education for our kids is going to get another nearly $20 billion a year from Barack Obama. But the government throwing money at schools is clearly not the answer: Washington D.C. spends more money per student than any public school system in the world, but provides the worst education in the country. As John McCain pointed out several times last night, again and again, Barack Obama sees big government spending other peoples’ money as the solution to every problem.

The obvious question to ask should be, where’s all this money going to come from? From “the rich”? Fat chance. Half of the rich are no longer “rich” after all their investments went south; they invested themselves out of Obama’s 5% group. The other half are going to shelter their money from Obama so they won’t have to pay Obama’s new taxes. Where’s Obama going to get his money? He’s going to come after you, and – given the polling figures – chances are you are too damn stupid to know it.

John McCain is being saddled with the anger and fear of voters over the financial collapse, according to most polls. Up until this week, neither President Bush, Senator McCain, Governor Sarah Palin, or most Republicans bothered to respond to the repeated Democrat charges that this fiasco was the result of the “failed policies of the last eight years.”

That perception needs to be changed by through a deliberate and sustained effort. It needs to begin tonight. And it needs to continue until November 4.

Barack Obama has been arguing that “guilt by association” is invalid. But Obama’s central charge against John McCain amounts to pure guilt by association: John McCain is NOT George Bush, and he has never BEEN George Bush. His entire career stands as a screaming testimony to the fact that he is very much his own man.

John McCain needs to find a few popular measures that President Bush supported and ask Barack Obama, “Do you oppose this because President Bush was for it? How about this? And this?”

Given the fact that Democrats are likely to not only continue to hold power – and even expand their power to a filibuster-proof majority -this economy cannot afford the domination of tax-and-spend socialist liberals in total control of our government.

John McCain and Sarah Palin need to examine Barack Obama’s tax plan. Obama claims that 95% of Americans would get a tax cut; the Republicans need to ask Obama if he actually believes that every single American pays taxes, such that 95% of Americans would receive a cut, and 5% would face a steep increase. Do Barack Obama’s two little girls pay taxes? How can he possibly give a “cut” to 95% of Americans? In reality, Barack Obama is using the IRS tax code to give at least 30% and as many as 40% of American tax filers who DON’T pay federal income taxes what amounts to a welfare check. And that is hardly what this economy needs right now. Republicans need to point out that Barack Obama will heavily increase the taxes of small business owners and people who invest in jobs and supply the money this country needs in order to grow and expand.

When you tax small business owners, they lay off employees; when you tax investors, they shelter their money. And that is hardly what this economy needs right now.

Barack Obama wants to massively socialize the American health care system – which represents about a quarter of the American economy. He makes a lot of promises, but the costs would be staggering. Massachusetts passed a law mandating universal coverage that promised to lower costs in utopian fashion; it is now facing $400 million in cost overruns in small state population in a short period of time. Barack Obama’s plan would be the same sort of disaster on a far more massive scale. And that is hardly what this economy needs right now.

John McCain needs to use Barney Frank as the poster child of Democratic negligence over Fannie Mae and Freddie Mac. Barney Frank – who had an inappropriate (homo)sexual relationship with a key Fannie Mae official even when his Congressional committee had direct oversight in regulating the agency. Barney Frank – who said for five years that Fannie Mae and Freddie Mac were healthy, and who led the Democratic fight against the very sort of regulation Democrats now claim the Republicans are guilty of having been opposed to. Barney Frank – the leading overseer of GSEs for the last two years – was continuing to claim that Fannie Mae and Freddie Mac were fine as recently as July 14 of this year. And John McCain needs to point out to the world that Fannie Mae’s and Freddy Mac’s stock crashed 90% while Democrats had direct control and direct oversight of these massive GSEs.

And that sort of corruption and incompetence is not what this economy needs right now.

And that sort of radical activity is not something that either this country or this economy needs right now.

Democratic Senate Majority Leader Harry Reid said, “I believe that this war is lost.” And Barack Obama would have ensured that the war would have in fact been lost had he been President. Obama talks about the loss of American prestige; does he genuinely believe that American troops slinking home in defeat with an emboldened terrorist enemy following us home would improve our international prestige? John McCain needs to link Harry Reid’s proclamation of defeat with Barack Obama’s determination to snatch defeat from the jaws of success.

That defeatist mentality is not something that this country can afford right now. As costly as a war is, the United States cannot afford to lose – and we would have lost had Barack Obama recalled the troops in defeat as he wanted to do three years ago.

Finally, John McCain needs to lead this nation to the conclusion that Barack Obama – the most radical, the most inexperienced, the most untested – candidate for President in this nation’s history, is not what either this country or this economy need right now.

Why should anyone blame Democrats for the housing finance crisis? Because they laid virtually all the landmines that would eventually explode in the first place, and then they wouldn’t allow Republicans to reform or even regulate the impending disaster before it occurred, that’s why.

“Fannie Mae, the nation’s biggest underwriter of home mortgages, has been under increasing pressure from the Clinton Administrationto expand mortgage loans among low and moderate income people and felt pressure from stock holders to maintain its phenomenal growth in profits. . . .

”Fannie Mae hasexpanded home ownership for millions of families in the 1990’s by reducing down payment requirements,” said Franklin D. Raines, Fannie Mae’s chairman and chief executive officer. ”Yet there remain too many borrowers whose credit is just a notch below what our underwriting has required who have been relegated to paying significantly higher mortgage rates in the so-called subprime market.” . . .

In moving, even tentatively, into this new area of lending, Fannie Mae is taking on significantly more risk, which may not pose any difficulties during flush economic times. But the government-subsidized corporation may run into trouble in an economic downturn, prompting a government rescue similar to that of the savings and loan industry in the 1980’s.”

”From the perspective of many people, including me, this is another thrift industry growing up around us,” said Peter Wallison a resident fellow at the American Enterprise Institute. ”If they fail, the government will have to step up and bail them out the way it stepped up and bailed out the thrift industry.” . . .

It’s one of the hidden success stories of the Clinton era. In the great housing boom of the 1990s, black and Latino homeownership has surged to the highest level ever recorded. The number of African Americans owning their own home is now increasing nearly three times as fast as the number of whites; the number of Latino homeowners is growing nearly five times as fast as that of whites….

Under Clinton, bank regulators have breathed the first real life into enforcement of the Community Reinvestment Act, a 20-year-old statute meant to combat “redlining” by requiring banks to serve their low-income communities. The administration also has sent a clear message by stiffening enforcement of the fair housing and fair lending laws. The bottom line: Between 1993 and 1997, home loans grew by 72% to blacks and by 45% to Latinos, far faster than the total growth rate.

Lenders also have opened the door wider to minorities because of new initiatives at Fannie Mae and Freddie Mac–the giant federally chartered corporations that play critical, if obscure, roles in the home finance system. Fannie Mae and Freddie Mac buy mortgages from lenders and bundle them into securities; that provides lenders the funds to lend more. . . . .

The Bush administration today recommended the most significant regulatory overhaul in the housing finance industry since the savings and loan crisis a decade ago. . . .

This reform – and another in 2005/06 – were blocked by Democrats who threatened to filibuster the bill in the Senate.

In that 2003 New York Times article, we find the extent of Republicans’ concerns, and of Democrats’ intransigence:

Fannie Mae, which was previously known as the Federal National Mortgage Association, and Freddie Mac, which was the Federal Home Loan Mortgage Corporation, have been criticized by rivals for exerting too much influence over their regulators.

”The regulator has not only been outmanned, it has been outlobbied,” said Representative Richard H. Baker, the Louisiana Republican who has proposed legislation similar to the administration proposal and who leads a subcommittee that oversees the companies. ”Being underfunded does not explain how a glowing report of Freddie’s operations was released only hours before the managerial upheaval that followed. This is not world-class regulatory work.”

Significant details must still be worked out before Congress can approve a bill. Among the groups denouncing the proposal today were the National Association of Home Builders and Congressional Democrats who fear that tighter regulation of the companies could sharply reduce their commitment to financing low-income and affordable housing.

”These two entities — Fannie Mae and Freddie Mac — are not facing any kind of financial crisis,” said Representative Barney Frank of Massachusetts, the ranking Democrat on the Financial Services Committee. ”The more people exaggerate these problems, the more pressure there is on these companies, the less we will see in terms of affordable housing.”

Representative Melvin L. Watt, Democrat of North Carolina, agreed.

”I don’t see much other than a shell game going on here, moving something from one agency to another and in the process weakening the bargaining power of poorer families and their ability to get affordable housing,” Mr. Watt said.

Democrats such as Watt and Maxine Waters played the race card to label any effort to prevent poor and black families from buying homes they couldn’t afford as racist.

“The — what we have now is a manmade disaster, a disaster that sprang — comes from the Bush failed policies, the failure of the Bush administrations to steward our economy in a responsible way.”

I am telling you, if you vote for Democrats in November, you will be putting the very people who caused this disaster in power, and you will be entrusting the people who created a crisis in charge of averting the very crisis they caused. By putting these irresponsible demagogues in charge of our economy during one of the most vulnerable periods in our nations’ history, you will in effect be saying, “I want the Great Depression. I want my children to suffer.”